Flying J, debtor granted interim access to $10 million DIP facility

By Caroline Salls

Pittsburgh, Feb. 27 - Flying J Inc. and its Longhorn Pipeline Inc. debtor were granted interim access to $10 million in debtor-in-possession financing from Merrill Lynch Commodities, Inc., according to a Friday filing with the U.S. Bankruptcy Court for the District of Delaware.

The final hearing is scheduled for March 4.

According to the motion, Longhorn owns and operates a pipeline that is filled with more than 900,000 of refined diesel and gasoline products that include a "winter mix" product. Flying J said the winter mix cannot be sold outside of the winter season, which ends in April.

Without access to the additional financing, the company said it is unable to ensure the winter mix product can be pushed through the pipeline for sale before the end of the winter season.

Although profit margins are not guaranteed, Flying J said the sale of the product currently in the pipeline could result in a $9 million profit for the company.

The DIP facility will mature on April 15.

Interest will be Libor plus 650 basis points, with a 3% Libor floor.

Flying J, an Ogden, Utah, fully integrated oil company, filed for bankruptcy on Dec. 22. Its Chapter 11 case number is 08-13384.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.